Of the Last 400 Customers Entering a Supermarket, 20 Have

question 108

Multiple Choice

Of the last 400 customers entering a supermarket, 20 have purchased a mobile phone. If the classical approach for assigning probabilities is used, the probability that the next customer will purchase a mobile phone is:

• A)0.80.
• B)0.20.
• C)0.05.
• D)0.50.

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Definitions:

Absolute Market Power

The ability of a single economic actor, or a group of actors, to control market prices, output, and/or the market entry of new competitors without external interference.

Barriers To Entry

Barriers to entry are obstacles that make it difficult for new firms to enter a market, including high startup costs, regulatory hurdles, and established competition.

Monopoly

A market structure characterized by a single seller selling a unique product with no close substitutes, leading to significant control over the market price.

Close Substitutes

Products or services that can serve as replacements for each other with minor adjustments, often similar in function or purpose.